Reportable Fringe Benefits

Reportable fringe benefits amounts form part of the expanded income tests used in determining eligibility for a number of taxation concessions and benefits of individual taxpayers.

Reporting Fringe Benefits -Threshold

Employers are required to itemise the grossed-up total of all reportable benefits over the threshold (currently $2,000) in each employee’s annual payment summary. The threshold is determined before grossing-up, and is not apportioned for a part year.

Benefits which are exempt from FBT are in general not reportable. However benefits which are exempt only because the employer is exempt, such as a Public Benevolent Institution, are required to be calculated and reported as the employee’s notional fringe benefits.

The threshold has been the same ($2,000) since 1 April 2007.

The grossed-up value of the threshold for the FBT year ending 31 March 2017 is ($2,000/(1-0.49)) = $3,921 (based on FBT rate of 49%)

For the FBT year commencing on 1 April 2017, the FBT rate will fall to 47% and the grossed-up value of the threshold will therefore become $3,774.

Calculation

The grossing-up of reportable fringe benefits is calculated at the Type 2 gross-up percentage.

Reporting Period

Reportable benefits are required to be calculated for the Fringe Benefits Tax year which runs from 1 April to 31 March. The reported amounts will be included in payment summaries issued for the overlapping tax year – i.e. from 1 July to 30 June.

Reportable fringe benefits are not taxable income, but they affect the calculations for various entitlements, levies and offsets which take adjusted income into account.

Non-reportable fringe benefits (“Excluded Fringe Benefits”)

Fringe benefits which do not have to be reported are referred to as excluded fringe benefits, and include the following:

entertainment you receive in the form of food and drink, including associated benefits such as travel and accommodation

remote area housing assistance, home ownership schemes, and repurchase schemes where the value of the benefit is reduced under FBT law

costs of occasional travel to a major Australian population centre by you and your family if you live in a remote area

freight costs for your food if you live in a remote area

fringe benefits you receive to ensure your security and personal safety because of your job

emergency or other essential health care you receive as an Australian citizen or permanent resident while you are working outside Australia and you cannot claim a Medicare benefit

certain Australian Government overseas living allowance payments

certain benefits provided to you if you are a defence force member

certain benefits provided to you if you are a police officer

car benefits coming from your private use of pooled or shared cars.

Regulation amendment 11 April 2013: to exclude living-away-from-home (LAFH) allowances and benefits, including certain expense payment benefits and residual benefits, from being reportable fringe benefits for Commonwealth employees where those employees are required to live away from their normal residence in order to undertake their official duties of employment. The Regulation ensures that the unique nature of Commonwealth deployments, such as Defence and Foreign Affairs deployments, do not result in unintended outcomes such as exceeding income thresholds relating to government benefits. The amendments apply in relation to benefits provided on or after 1 October 2012, to align with the MYEFO amendments to LAFH allowances and benefits.

Individual tax return reporting of benefits

Reportable benefits shown on payment summaries are required to be declared in an individual’s tax return.

The quantum of benefits reported will correspond to totals for the immediately preceding year ending 31 March, being the FBT year.

Information is entered into the “Income tests” information area of the tax form which requires itemisation of fringe benefits amounts, reportable superannuation and other matters.